In a significant move towards the empowerment of policyholders and bolstering inclusive health insurance, the Insurance Regulatory and Development Authority of India (IRDAI) has announced a major revamp of regulatory norms. 

The regulator has issued a comprehensive Master Circular on Health Insurance Products repealing 55 circulars.  The master circular gives operational effect to a slew of regulatory changes announced by IRDAI last month in health cover including the removal of upper cap on age and brings in new features such as customer information sheet to provide transparency and the option to distribute claim amount from multiple policies one may have from different companies.  

All the entitlements in a health insurance policy available to a Policyholder have been brought in one place in the Master Circular. 

The repeal of previous circulars has been done to provide for new norms and also to make a single point reference on the total norms for policyholders as well as the insurers

It also emphasised measures towards providing a seamless, faster, and hassle-free claims experience to a policyholder procuring a health insurance policy and ensuring enhanced service standards across the health insurance sector.

The major norms spelled out by IRDAI include a wider choice for the policyholders to be provided by the insurers by making available products/add-ons/riders by offering diverse insurance products catering to all ages, regions, occupational categories, medical conditions/ treatments, all types of Hospitals and health care providers. 

This is aimed at providing suitability and affordability. The insurers will also need to provide a Customer Information Sheet (CIS) along with every policy document. 

Customers are also to be provided with the flexibility to choose products/add-ons/riders as per their medical conditions/specific needs.

A policyholder with multiple health insurance policies gets to choose the policy under which he/she can get the admissible claim amount. “‘The primary insurer with whom the claim is first submitted should coordinate and facilitate settlement of balance amount from the other insurers,” IRDAI said. 

In the event of no claims during the policy period, the insurers may reward the policyholders by providing an option to choose a No Claim Bonus, either by increasing the sum insured or discounting the premium amount.

Policyholder to get a refund of the premium or proportionate premium for the unexpired policy period if he chooses to cancel his/her policy at any time during the policy term. 

A health insurance policy is renewable and shall not be denied on the ground that claim (s) was made in the preceding policy years, except in case of established fraud or non-disclosure or misrepresentation by the Insured, IRDAI said. 


Policyholders will gain significantly in the wake of new norms, according to industry experts. According to Sharad Mathur, Managing Director & Chief Executive Officer, Universal Sompo General Insurance, the master circular issued by IRDAI “will simplify the insurance buying and servicing process even further.’‘

Newly introduced measures such as the processing of cashless authorisation requests within one hour, the freedom to choose treatment of choice, including Ayush-certified therapies, and the choice of adjusting the No Claim Bonus by discounting future premiums or increasing the sum assured are bound to delight existing policyholders,’‘ he added.

Anuj Parekh, co-founder and CEO of Bharatsure, said the norm for insurers to provide cashless authorization within one hour and final authorisation within 3 hours of intimation by the hospital will make the process more efficient and can significantly improve the customer experience for the patient and their family members. 

Narendra Bharindwal, Vice President, Insurance Brokers Association of India (IBAI), said the Master Circular outlines several key points for health insurance policyholders and insurers, such as the right to a policyholder to seek a refund of premiums for the unexpired policy period if they cancel their policy early.

“The aim is to achieve 100 per cent cashless claim settlements and streamline the health insurance process,’‘ he added.